Agenda item

Due to the length of this report, only the covering report has been included in the main agenda for this meeting.  The full length report, including appendices, has been published in a separate supplementary pack for the meeting.

The Portfolio Holder for Finance and Enabling presented the Finance and Performance Quarter 2 Report 2023/24 for the Committee’s consideration.

The Committee was advised that the Council had an £11.1 million budget for 2023/24 which had been approved by Council in February 2023. By the date of the meeting, the Council was forecasting a revenue overspend for 2023/24 in the region of £596,000.  The overspend position was mainly due to the pay award of £1,925 to all staff, backdated to 1^st Aprill 2023 as well as to the impact of homelessness and temporary accommodation costs.  However, this would be partly mitigated by the receipt of homelessness prevention grant funding, use of unused funding from the utilities reserve and an increase in income for some service areas.

The Council has a capital programme of £12.6 million which was approved in the budget in February 2023. Of this, £10.6 million was externally funded whilst £2.0 million was Council funded. At quarter two, the actual spend against the original 2023/24 capital budget was £1.267 million.

By the date of the meeting, it was anticipated that there would be underspends in the Housing Revenue Account (HRA).  Budget underspends were projected against repairs and maintenance and supervision and management due to vacancies in some parts of the service. This resulted in an overall projected surplus on services totalling £73,000, which would be contributed to HRA reserves. In addition to this, there was a £174,000 projected underspend against the £11.725 million HRA capital programme.

Members subsequently discussed the content of the report in detail and in so doing commented on the following points:

·             The Town’s Fund allocation for Redditch and whether this would be sufficient to cover the financial costs involved in work on the innovation centre, demolition of the current library site in the town and the refurbishment of the Town Hall.

·             The decision making process that had been followed for the use of the Town’s Fund.  Members were advised that figures in reports had initially been based on estimates and all of these issues had been reported to both the Executive Committee and Overview and Scrutiny Committee.

·             The proposed bids for fundings in respect of the innovation centre and project managers, due to be considered by the Executive Committee in January 2024.

·             The poor energy efficiency rating that had been reported for Winyates Craft Centre and the action that would be taken to address this.

·             The potential issues, in terms of the energy efficiency ratings of other community centres in the Borough and the plans in place to address this.

·             The timescales for completion of the review of the energy efficiency ratings of all of the Council’s assets.  Officers explained that further clarity on this point should be available by spring 2024.

·             The extent to which the Council was likely to receive additional funding from the West Midlands Combined Authority (WMCA) for projects in the town centre.

·             The Council’s eligibility to receive funding as a partner in the former Greater Birmingham and Solihull Local Enterprise Partnership (GBSLEP) and the extent to which access to this funding was at risk following the issuing of a Section 114 Notice to Birmingham City Council.  Officers clarified that all of the partner organisations from the former GBSLEP had agreed that the LEP’s remaining funds should be divided equally and each organisation, including Redditch Borough Council, was due to receive £2.5 million.

·             The risks to the Council’s finances that would arise should the projects delivered using Town’s Fund support not be delivered to deadline.  Officers confirmed that this was a risk, although extensions were likely to be offered.

·             The six-month extensions that had already been offered by the Government to Councils in receipt of New High Street funding, where needed, which was originally due to be delivered by 31^st March 2024.

·             The deadline for the delivery of projects using Levelling Up funding, which was 31^st March 2025.  Officers confirmed that Bromsgrove District Council had requested an extension to the deadline for their project.

·             The initial conversations that officers had already held with the Government about the potential for an extension for Redditch on the Town’s Fund, should this be required.  The Government had responded by highlighting that this was two and a half years away and therefore a decision could not be taken on an extension in respect of this matter at this stage.

·             The progress that had been achieved with sales of Council land, as previously agreed by Members, and the extent to which these sales were likely to attract the capital receipts that had been anticipated.  Officers explained that an agreement was close to being reached on Far Moor Lane and a report in respect of a separate land sale would be presented for Members’ consideration in January 2024.

·             The desktop investigation into Reinforced Autoclaved Aerated Concrete (RAAC) and the outcomes of this investigation.  Officers explained that this review had found no Council assets that had used RAAC, although if any examples were identified, these would be reported.

During consideration of this item, reference was made to the Budget Scrutiny Working Group’s pre-scrutiny of the Finance and Performance Quarter 2 Monitoring Report 2023/24.  The group had made a number of recommendations on this subject, which had been endorsed by the Overview and Scrutiny Committee at their meeting held on 30^th November 2023.  The Executive Committee welcomed the work of the Budget Scrutiny Working Group and it was confirmed that the group’s recommendations would be approved.

RESOLVED that

1)          the current overspend position in relation to Revenue and Capital Budgets for the period April to September 2023 and the full year overspend position of £39,000 after applying £557,000 from the Utilities Reserve as approved at Quarter 1 be noted;

2)          the present status of the Asset Strategy be noted;

3)          one additional contract be added to the procurements over £200k due to be delivered during 2023/4 from the Quarter 1 list;

4)          the Quarter 2 Performance data for the Period April to September 2023 be noted;

5)          an officer report be requested that provides a model of the financial implications of an unusually high demand for emergency housing and temporary accommodation support;

6)          with reference to the Strategic and Operational Performance measures in the Report (subsection Work and Financial Independence), the Essex / Preston models that link skills and developments to social value within Procurement be examined further; and

RECOMMENDED that

7)          Changes to the Capital Programme in relation to ICT are actioned, bringing forward Cyber Security linked Tape Drive replacements from 2024/5 into 2023/4.